Corporate Governance in the UK: Is the Comply or Explain Approach Working?

  title={Corporate Governance in the UK: Is the Comply or Explain Approach Working?},
  author={Sridhar Arcot and Valentina Bruno and Antoine Faure-Grimaud},
  journal={CGN: Statutes \& Codes (Sub-Topic)},
We examine the effectiveness of the "Comply or Explain" approach to corporate governance in the UK. Using a unique database of 245 non-financial companies for the period of 1998-2004, we find an increasing trend of compliance with the Combined Code, but a frequent use of standard explanations in case of non-compliance. We show how the Combined Code has been interpreted and applied, and we discuss the existence of enforcement and monitoring problems. We make recommendations so that the approach… Expand
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